Goal At O'hare: Frequent Fliers, Frequent Buyers

Marching off a flight from Pittsburgh with a Brookstone Co. bag in hand, Joyce Frye had this assessment about the state of shopping at O'Hare International Airport:

"It's desperately in need of an upgrade," said the Naperville resident who is in the employee-relocation business.

By contrast, Frye sang the praises of Pittsburgh International Airport, which has attracted worldwide attention for its terminals filled with upscale shops --yes, there's even a Gap--and name-brand eateries.

"It's wonderful," said Frye, who travels there twice a month on business. With time to kill last week at Pittsburgh's airport, she went on a shopping spree in one of the specialty stores, ending up with a bag full of gadgets, including a booklight for night reading.

It may not seem like rocket science, but major airports around the country have only recently begun to come to this startling realization: People with time on their hands, Gold Cards in their pockets and no place to go until boarding will spend lots of money on good food and familiar products. Instead of kitschy T-shirts or withered hot dogs spinning on greasy rollers like lost luggage on a conveyor belt, the well-heeled passenger is willing to part with some bucks for designer coffee and trendy clothes.

The payoff for this approach has been huge: Airports in Pittsburgh, Portland, Ore., Washington, D.C., and others around the country report passenger spending has in some cases more than doubled, offsetting airport operating costs.

O'Hare, in contrast, is still largely a wasteland for shoppers and diners, though the 3-year-old international terminal boasts a glittering food court and an FAO Schwarz. The older domestic terminals, which weren't built with shopping in mind, have little space devoted to such pursuits.

And what is offered, despite some improvements such as Starbucks Coffee stands, doesn't set cash registers humming.

After years of talk, city officials late last year announced a plan to spend up to $74.8 million to overhaul food and shopping offerings in the domestic terminals. The plan calls for boosting concession space by as much as 76 percent.

The first leases under the makeover represent a mix of brand-name fast food and retail. McDonald's franchises and a joint venture that will operate Waterstone Books stores were among the leases announced last week. The agreements are subject to City Council approval, but airport officials hope some of the new shops will be open in time for the Democratic National Convention in August.

The city's Aviation Department scrapped a plan to hire a private company to control airport leases, citing opposition from aldermen who viewed it as a power grab by Mayor Richard Daley. But those tapped by the administration as leaseholders include key Daley allies such as former state Sen. Jeremiah Joyce, one of his closest political advisers; Grace Barry, a longtime friend of the mayor's wife; and Barbara Burrell, a former advertising executive and a Daley supporter.

Aviation officials have defended the agreements, saying they provide expanded roles for minority business owners.

Airlines, which pay for much of the airport's operations, welcome the concessions overhaul as a way to reduce costs at a time of increased competition. Most of the renovations would be financed through the sale of bonds paid off by airport revenues.

For passengers such as Dr. Paul Scheel, a kidney specialist from Baltimore who was munching a slice of soggy pizza last week in Terminal 2, the changes promise more varied fare.

"When you walk down the corridor, you have a choice of very little," said Scheel, a frequent visitor to Chicago who rates O'Hare's food choices "very low" compared with other airports.

The remake also will mean cheaper prices. As in the international terminal and at other airports that have redone concessions, Chicago plans to require stores to set prices similar to those charged outside the airport.

The difference is already apparent at O'Hare. Travelers pay $3.70 for the pizza in Terminal 2 at a snack bar operated by Bethesda, Md.-based Host International, which has long run all food operations in the domestic terminals. At the Pizzeria Uno outlet in the international terminal, passengers pay $2.35 for a slice.

Despite lower prices, purchases are expected to jump so much at O'Hare's domestic terminals that overall spending could surge 94 percent to $175 million a year from $90 million.

The idea has worked at other airports.

"Sales go through the roof," said Sheldon Klapper, president of the Center for Airport Management, a consulting firm in Portland. "People vote with their wallet. It's amazing. They go, `Wow, I'm not being ripped off.' "

That's what happened in Pittsburgh.

The average passenger had been spending $2.40 at the old airport. Last year at the new airport, each passenger spent $6.60 in more than 100 stores and restaurants.

O'Hare passengers generally favor more shopping and eating choices, but they don't see the airport replacing the local mall.

Leo Geller of Rolling Meadows flies frequently to Pittsburgh on business and bought a leather portfolio there last fall. But mostly he just window shops.

"People like me, we don't have to live in the airport, we just want to pass through efficiently," he said.